Healthcare segment to post 13 per cent growth

Our Corporate Bureau

New Delhi, May 15: India’s healthcare industry is expected to grow by around 13 per cent a year for the next 6 years, according to Confederation of Indian Industry (CII).

The rise in literacy rate, the higher levels of income and an increased awareness through the deep penetration of media have contributed to the greater attention, the healthcare segment is getting in India, the industry body said in a statement adding that India’s healthcare sector has grown to a $17 billion industry.

Presence of a vast insurable population in India provides tremendous opportunities, CII said adding that currently only 2 million people, which is 0.2 per cent of the total population are covered under mediclaim.
According to a recent study, there are 315 million potentially insurable people in the country. Even after scaling down these numbers, the market is significant, it said. Insurance companies have estimated that 6 per cent of household income will be spent on healthcare, up from the current 2 per cent. The industry, according to CII is expected to undergo a drastic change with the advent of managed care systems in the form of Preferred Provider Organisations (PPO) - which will metamorphose into Health Maintenance Organisations (HMO) in the long run.

CII estimates that the $761 million health insurance business to swell five times, to $4 billion by 2005. Citing that good healthcare in India is in extreme short supply, CII stated that it is this gap that presents vast opportunities to the corporates. The private healthcare segment, it said, has grown into a formidable industry.

Major corporations like the Tatas, Apollo group, Fortis, Max Wockhardt, Piramal, Ispat, Duncan and Escorts have made significant investments in setting up state-of-the-art private hospitals in cities like Mumbai, New Delhi, Chennai and Hyderabad, it said. The increase of 16 per cent in the budgetary outlay in the Union Budget reinstates the government’s focus on healthcare sector, it said adding that the budgeted central plan outlay for health and family welfare is estimated at Rs 5,780 crore for 2001-02.